The law of contract in our country stipulates the legal hypothec of construction project contractor, but doesn t define the conflict between the legal hypothec and the normal hypothec.

The question whether the law character of construction project loan preference is priority or legal hypothec is the dissimilarity of the form only.

This article makes a deep research on the creation of mortgage for co-owner ship with real-law theories and gives different understanding on article 16 of CMI from different angles.

Based on the comparison of Payment Guarantee, Statutory Mortgage and Rights of Subrogation, the advantages and disadvantages of these processes are analyzed to offer suggestions for contractors to recover the payment successfully.

This article analyzes pertinent elements of statutory mortgage, its concept and nature, its precedent conditions and timing, its binding effect, and soluti.

The statutory mortgage settled in Clause 286 of the Contract Law consists of warrants obligatory right and its limits;the object of a statutory mortgage;the registration of a statutory mortgage;and the prior compensation for either statutory or stipulated mortgage when there is a conflict between them.

According to No286clause of Conta ct Law,the priority right to be repaid of contractor belongs to legal mortgage p ower,whose foundation is directly under the principle of law.

Based on analysis of the legislative procedure of the item including its design, drafting, consultation, revision, and deliberations, this essay suggests that the said right belongs to legal mortgage in its nature.

The system of legal mortgage has not been clearly regulated in China s current law system of the real right.